So, you are getting ready for retirement?
Chances are good that your children have left the nest.
Perhaps you are assisting your aging parents with their personal, health care and financial responsibilities.
This would be a good time to create (or revisit) your estate plan, as well as make sure your adult children and parents have their legal ducks-in-a-row, too.
Unfortunately, many married couples mistakenly believe they can make personal, health care and financial decisions for one another should either spouse become legally incapacitated due to a serious injury or illness.
Nothing could be further from reality!
Without proper estate planning in advance to appoint your spouse as the incapacity decision-maker, he or she will not have legal authority to make even fundamental decisions for you (or affecting both of you).
For example, medical privacy laws will bar access to your medical records and the ability to consult with your attending physician, financial laws limit control over your finances, and IRS regulations will prohibit filing a “legal” joint income tax return … for starters.
Unless you legally appoint the decision-maker of your own selection in advance through proper estate planning, then a probate judge will select one for you.
While the judge will likely appoint your spouse, the probate court process to accomplish this is expensive (it employs at least three attorneys), discloses your private personal and financial information to the public record and is a real hassle for your spouse.
Did you know that in the absence of proper estate planning, your assets may be distributed after death based on “one-size-fits-all” state laws written for people who do not have their own estate plan?
Of course, this impersonal estate plan written by state lawmakers may not reflect your own unique circumstances and objectives for your spouse and assets.
In fact, depending on how you titled your assets and how your beneficiary designations are arranged, you may disinherit your own spouse and force your spouse to sue your estate!
Now, have you given any thought to what might happen if something untoward "happens" to you or your spouse?
In other words, what if one spouse dies and the other remarries?
Well, if you want to risk losing about half of what you have should the remarriage not work out or disinheriting your own children and grandchildren, then do nothing.
On the other hand, I always tell my clients that “love may be blind, but it is best to go into a new relationship with both eyes open.”
In short, the surviving spouse will need to have a legally enforceable premarital agreement inked before saying “I do” on his or her wedding day.
Since I prepared my first estate plan in January of 1985, I have noticed some things.
For example, when a wife loses her husband, she grieves. When a husband loses his wife, he replaces.
In fact, this is supported by a University of California study. Researchers there found that 60% of widowers are involved in a new relationship within two years after losing their wives, while only 20% of widows have a new relationship.
But, wait, there is more.
According to the U.S. Census Bureau, men are 10 times more likely to remarry after age 65. And the average time before they are remarried is just 2.5 years. When dad remarries a new wife some 20 years his junior that can trigger all kinds of drama in the family, to say the least.
Research aside, I believe men do not mature fully until at least age 95.
We are helpless, vulnerable and gullible.
This is a dangerous combination.
Women, on the other hand, likely have relationships with children, grandchildren and other widows.
Why would a widow want to remarry some other woman’s “unfinished project” and spoil her nice lifestyle?
As you can see, planning for being single again includes planning for any new relationships on the future, while preserving (and protecting) the relationships you already have.
When it comes to your children, great care should be given to protect any inheritance both for them and from them.
For starters, wealth representing a lifetime of your hard work and thrift can be squandered in very short order.
Dollars earned just spend differently than dollars inherited.
In addition to good, old-fashioned squandering, an inheritance can quickly vanish through divorces, lawsuits and bankruptcies.
Fortunately, with proper (and very careful) estate planning, you can provide an inheritance that is protected for and even from your own children.
Remember, two things you cannot choose in life are your own folks and the spouses of your children.
What is your plan to pay for long-term care, if you need it?
Have you noticed how expensive the continuum of care is?
From in-home assistance to assisted living to skilled nursing the expenses can destroy savings and investments created over a lifetime of hard work and thrift.
As you near retirement, lock-in a long-term care insurance policy while you are still able to qualify physically and mentally.
Some versions of coverage only pay if you need long-term care assistance, but others can now do double-duty and turn into life insurance if you do not need such assistance.
That is a popular alternative to traditional long-term care insurance.
Disclosure: Gretchen and I obtained our own long-term care policies when we were both age 49.
We want to preserve our assets because there is a 70% risk of needing long-term care once you reach age 65.
Curiously, 70% of people think they will not be among those 70% needing care (i.e., denial) and 70% of people think Medicare will pay for it (i.e., ignorance)!
We do not want to be in that 70% who are in denial, ignorant or both.
If Gretchen or I need assistance with the activities of daily living (e.g., eating, bathing, dressing, toileting, and transferring), then we want to hire a professional to take care of them instead of our daughters.
As you can see, looking forward to retirement can be fun.
At the same time, however, now is a good time to get your proverbial estate planning and financial planning ducks in a row.
If all this sounds like something you would want to avoid, then contact an experienced estate planning attorney as one of your first new year's resolutions to get the ball rolling.
So, how do you find an "experienced" estate planning attorney?
First, ask around. Friends, family and other professional advisors are trustworthy sources.
Second, conduct an "organic" search on "Google" for "estate planning" near you (e.g., "Estate Planning Anytown MoKan").
Third, either way, verify! Check out the education, experience, ratings and client reviews of any attorney before you contact him or her.
In fact, I use both of these services to thoroughly vett attorneys before referring members of our "client" family for legal help in other areas of law or for matters in jurisdictions outside Kansas or Missouri.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there